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Liz and Rob Virtue have owned historical estate Glen Derwent — 40 minutes north-west of Hobart — for eight years.
The tourism and hospitality business operates a tearoom, accommodation, and campground onsite, and is also a popular wedding venue.
"We've always been interested in heritage houses, it was a dream to own one … this ticked all the boxes," Ms Virtue said.
Robert and Liz Virtue are turning their attention to the next challenge. (ABC News: Ebony ten Broeke)
But increasing costs, especially insurance for the 206-year-old property, were the "straw that broke the camel's back", with the couple making the hard decision to close Glen Derwent's doors from November 18.
And while the couple say "we've had a ball, we've had a great time and hopefully we're leaving a bit of a legacy", they also fear for the future of businesses like theirs.
"I think this is a sign of things to come, and it's going to depend entirely on people's resilience and ability to keep propping up their businesses," Ms Virtue said.
Glen Derwent offers tourist accommodation, as well as campgrounds, tea rooms and functions. (Facebook: Glen Derwent)
Insurance increase a factor in decision
Ms Virtue said they were advised the property was under-insured, so they sought a professional valuation of its replacement value, which came out to $5 million.
Their current insurer then refused to renew their policy.
"That left us scrambling, looking for other insurers. It's all to do with our postcode, our heritage listing, our proximity to the river — even though they don't cover us for flood — and the insurance industry's appetite for risk," Ms Virtue said.
Tea rooms at Glen Derwent. (Facebook: Glen Derwent)
In November 2016, insurance for the business came in at $6,915.45; in 2024 they were quoted $35,000.
Insurance costs are not solely responsible for the business closure, with land tax also a factor.
Increasing council rates, state government charges, interest rates on their commercial property loan and a state-wide downturn in tourism, have all contributed to the business becoming unviable, they said.
"Overall, it comes to about an 88 per cent increase, [since 2017] and we can't increase our prices by 88 per cent," Ms Virtue said.
"Ask anybody how they're going with their local cafe or their bed and breakfast, and I think most people would report that that this has been their worst winter ever.
"It's just a combination for us that we're not in a position to keep pumping money into it [the business] and running at a loss," Ms Virtue said.
Challenges felt across the industry
Chief executive of the Tourism Industry Council Tasmania Amy Hills said businesses across the industry have experienced significant increases over the last four to eight years.
"As small operators, with the visitation that it is at the moment, it's really hard to weather, and you put that against all the other increasing costs of doing business, and as a consequence, you'll see decisions like Glen Derwent," Ms Hills said.
Amy Hills says they're putting pressure on governments to address the issue. (Supplied: LinkedIn)
Ms Hills said the industry body have been hearing anecdotal case studies of businesses struggling in Tasmania every day.
"I'm really concerned about the impact and what it will mean for our destination if we don't find some solution to this, because these products and experiences are what makes our destination us, they make us 'Tassie'.
"So, we really are ramping up pressure on all tiers of government to have a look at this," Ms Hills said.
In a statement, Minister for Small Business and Consumer Affairs Michael Ferguson said the Tasmanian government "recognises many small businesses are facing increased costs due to the national economic headwinds".
"We are working to ease that burden on our small businesses through a range of services and programs that provide financial support and relief, in addition to initiatives targeted at reducing red tape to keep the cost of doing business down," Mr Ferguson said.
"We are continuing to work closely with the tourism and hospitality sectors to further understand the key issues affecting them, and to determine how best the Tasmanian government can support them through these challenging economic conditions."
The Glen Derwent homestead pictured around 1900. (Supplied: Glen Derwent)
'We'll find a new dream'
The Virtues have announced Glen Derwent will be closing on November 18 2024, with Liz Virtue saying: "I wouldn't be putting my hand up to run a tourism or hospitality business in the foreseeable future until some things change".
"It's not just the state government … the fire levy, stamp duty and land tax; it's climate change and the amount of extreme weather events we're having, and the impact of insurance claims from those events on insurance companies," she said.
"We've decided enough is enough.
"We'll find a new dream. It's a first world problem … there's silver linings."
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